Healthcare costs are a real and growing burden for American families, and hospitals share that concern. Understanding who is driving those costs matters for finding real solutions.
66%
of adults worried about affording healthcare for themselves and their familyKFF Health Tracking Poll, Jan. 2026
51%
worry about paying for needed healthcare services — up from 42% in 2021
West Health-Gallup, 2025
26.7M
Americans under 65 without health coverage in 2024 — up 1.3 million from 2023
KFF/U.S. Census ACS, 2024
<50%
of Americans can consistently afford the care they need — a five-year low
West Health-Gallup Affordability Index, 2025
Hospitals carry the weight of a complex system
Hospitals do not control most of the major cost drivers in healthcare, but they absorb the financial consequences of them. Rising labor costs, pharmaceutical prices, supply chain disruptions, and increasing red tape from insurers all add pressure to the cost of providing care.
Additionally, hospitals aren’t always fully paid for the care they provide to patients. This unpaid care comes from underpayment from government insurers like Medicare and Medicaid and caring for patients who can’t pay because they don’t have insurance coverage or have coverage with high out-of-pocket expenses.
Unfortunately, more Tennesseans are finding themselves without health insurance, or with limited coverage with lower monthly costs but higher out-of-pocket costs when they need care. At the same time, enrollment in Marketplace health plans is expected to decline as the federal premium assistance program expired, making coverage less affordable for many families.
NATIONAL – SINCE 2000
$745B
in uncompensated care
Since 2000, U.S. hospitals have provided nearly $745 billion in uncompensated care — delivering treatment regardless of a patient’s ability to pay.
Source: American Hospital Association – aha.org/fact-sheets/2020-01-06-fact-sheet-uncompensated-hospital-care-cost
TENNESSEE – ANNUAL
$5B+
in unpaid care each year
Each year, Tennessee hospitals shoulder more than $5 billion in unpaid care for uninsured and underinsured patients — absorbed by the institutions serving every community in the state.
Source: Tennessee Hospital Association
Insurance Red Tape Burdens Patients and Providers and Increases Healthcare Costs
Behind every healthcare bill is a web of insurer rules designed to slow down or limit care like prior authorization, claim denials, step therapy, referral requirements, or other restrictions. Each one adds delay, cost, and frustration for patients and the providers trying to treat them.
Some tactics insurers use to slow down or limit care:
Prior Authorization
Insurers require advance approval before a patient can receive certain treatments, even when a doctor has already determined the care is necessary.
93% of physicians report delays
Claim Denials
Insurers reject claims for care already provided, often over paperwork technicalities, forcing hospitals to spend time and money appealing decisions for care patients already received.
11.8% of claims initially denied
Step Therapy & Fail-First Policies
Patients are required to try, and fail on, cheaper treatments before insurers will approve the medication or therapy their doctor originally recommended.
Often delays the most appropriate care
Referral Restrictions
Narrow networks and referral hoops add extra steps and delays before patients can see the specialist their doctor refers them to.
Adds steps between diagnosis and treatment
Formulary Exclusions
Insurers remove medications from covered drug lists, including common generics like insulin and albuterol, forcing patients to switch treatments or pay out of pocket.
Denials for essential meds up 16% since 2018
Documentation & Coding Hurdles
Claims are denied over technicalities like a missing form, an outdated code, or an incomplete field, requiring rework that delays payment for care already delivered.
$57 average cost to rework one denied claim
The Toll on Patients and Providers
93%
of physicians report prior authorization delays patient care
American Medical Association
80%
say these delays cause patients to abandon treatment altogether
American Medical Association
43%
of U.S. physicians report symptoms of burnout
Commonwealth Fund, 2025
65%
cite insurance-related admin tasks as a major driver of that burnout
Commonwealth Fund
What Happens When Insurance Red Tape Stands in the Way
Care is Requested
Physician orders treatment
Insurer Review Delays It
93% of physicians see delays
Patients Give Up, or Claims are Denied
80% report treatment abandonment
Costs Rise System-Wide
$35B in added annual cost
The cost doesn’t disappear. Every denied claim, every prior authorization delay, every step therapy requirement adds administrative work that hospitals and physicians must absorb, driving up the cost of delivering care.
$35B
added to the healthcare system every year by prior authorization alone, on top of the cost of denials, appeals, and rework across the system
Despite these pressures, Tennessee hospitals continue to care for their communities and treat every patient who walks through the door, regardless of their ability to pay.
Open 24/7
Emergency & Safety Net Care
$1.4 Billion in Charity Care
872,575 Admissions
Over 3.4 Million ED Visits
85,000 Births Annually
Hospitals Care About Healthcare Affordability
Hospitals know healthcare costs are a real burden for Tennessee families. From price transparency to care models built to keep people healthier and out of the hospital, hospitals are actively working to lower costs and give patients clear, upfront information about what care will cost.
Posting Prices Upfront
Hospitals publish standard charges and out-of-pocket cost estimates so patients know what to expect before they receive care.Coordinating Care to Prevent Costly Hospitalizations
Care coordination and chronic disease management programs help keep patients healthy and out of the emergency room in the first place.Investing in Technology that Lowers Costs
Telehealth, remote monitoring, and other technology investments reduce unnecessary ER visits and readmissions for patients and families.Finding Efficiencies without Cutting Care
Hospitals continuously work to reduce operating expenses through smarter operations — protecting the quality of care patients receive.Sources: American Medical Association, Prior Authorization Survey 2025 (ama-assn.org); Commonwealth Fund, Causes and Impacts of Burnout Among Primary Care Physicians, Nov. 2025; Health Affairs, Current Prior Authorization Landscape (healthaffairs.org); American Hospital Association, Skyrocketing Hospital Administrative Costs report, 2024 (aha.org); HHS Office of Inspector General, Medicare Advantage denials report; Aptarro, US Healthcare Denial Rates & Reimbursement Statistics 2026; AJMC, How Insurance Claim Denials Harm Patients’ Health and Finances.